Looking to the Future of IT Outsourcing

The world of IT outsourcing looks different from what it did a couple of years ago; as technology advances and businesses expand, what will the future bring for buyers and service providers?

We've looked at the future of IT outsourcing before and shared our thoughts, but in this rapidly changing world of emerging technologies and game-changing innovations, the future is a concept that's constantly being refactored. As we dive further into 2019, we'd like to take another look at what the future may hold for IT outsourcing in the coming few years.

A New Kind of Outsourcing

Historically, outsourcing has been about lowering production costs. However, in the past few years, the focus has been steadily shifting from cost saving to improved processes and advanced capabilities. This means buyers now search for very different attributes when it comes to an outsourcing partner.

Likewise, the rise of intelligent automation technology is making way for a new kind of outsourcing. One that's not about handing over menial tasks to a partner offshore but more about finding a team that works effectively as an extension of their own in-house team.

"The move from cost to quality is only natural if you realize that a technical asset well implemented will leverage your business in many orders of magnitude. Whereas a technical asset poorly implemented will cost you the market," says Alejandro Vasquez, VP of Business Development at PSL. "Nobody wants to use a mediocre application with poor user experience and little perceived value."

The Added Value of Innovation

In software and IT, one innovative, game-changing idea can make all the difference. But, for the most part, service providers don't offer to help companies with their innovation efforts. For one, vendors may not feel there's much motivation to push innovation for clients, as it doesn't represent financial gain for them. Likewise, companies may feel it's not necessary to pay for innovation help or guidance unless they're part of specific industries where innovation is their bread and butter.

However, innovation may be the key driving force for business growth, regardless of industry. Software development outsourcing vendors have access to a variety of knowledge and experience that can be invaluable when innovating. And, what's good for the client is good for the vendor, but that means establishing a relationship that works more like a partnership where each side is proposing new ideas, pointing out areas for improvement, and generally collaborating to bring the best product to market. By continuously striving for innovation, identifying opportunities and ways to cater to new markets, a company stands to make headway in their industry and reap significant benefits from it.

More Specialized Services ​

It seems every market has solutions that are growing in sophistication. The more conventional model of a jack-of-all-trades software outsourcing service provider is quickly becoming obsolete, as companies are looking for providers that can help them with highly specialized requirements. For instance, companies with large amounts of data may find greater value in a service provider equipped to help them process and gather insights that they can use to inform business decisions. To do so, they will need to count on companies with the capabilities to support these complex systems and processes and contract highly-specialized professionals in areas like Data Science, DevOps, Security, UX, Performance Engineering, and more.

A More Human Approach ​

With technological advancement has come an age of more sophisticated and demanding consumers. The experience economy, one where value is tied to experiences and other intangible characteristics, is demanding companies look at their products and dare to see beyond the average. This means, companies are looking for service providers that take into account design, culture, storytelling, and values, as well as focus on user experience and employ a customer-centric approach.

As the future steadily approaches, these new shifts in the way businesses contract their outsourcing providers takes a turn for the specialized and the innovative. IT outsourcing companies aren't just expected to work faster and for less, but at a level of quality that's comparable to their clients, with sights set on providing the best user experience possible.

--Looking for a nearshoring partner with the right mix of tech capabilities? Schedule a call with PSL.

About PSL

We are a purpose-led software company with 33 years of experience and over 700 driven and passionate engineers. PSL partners with its clients from nearshore locations to help them succeed on their most complex software development challenges. We deliver world-class quality software using agile processes and real-time interaction with our clients. Read more